KARACHI: Millions of Pakistanis have lost jobs in the economy’s formal and informal sectors owing to a sharp decline in industrial production in the current fiscal year.
Production operations have been significantly impeded by the continuous limitations on imports of raw materials, the foreign exchange crisis and high inflation brought on by soaring electricity and gas bills, according to a report in an English daily.
Stakeholders said that “over 500,000 people have faced joblessness” in four industrial areas of Karachi and the country’s auto sector.
However, a representative of the Sindh Government Directorate of Manpower, Labour, and Human Resource, who requested not to be named, claimed that traders were exaggerating the numbers.
He estimated that 15-20% of people were jobless in the industrial sector and blamed many factors, including currency rate issues, for the employment crisis.
According to the Bureau’s Monthly Industrial Production and Employment Survey (MIPE), 202,663 people worked across 18 different industry groups in February 2023, down from 221,163 in February 2022. The number of production employees in the aforementioned industries fell from 164,791 in February 2022 to 151,194 in February 2023.
The total number of employees in February 2023 was 205,000 compared to 220,000 in February 2022, and there were 155,000 production workers in large-scale units in February (2023) compared to 165,000 in February 2022.
President of the Site Association of Industry (SAI), Riazuddin, stated that, aside from the food industry, some 100,000 out of the 500,000 people in the Site area had lost their jobs in a variety of businesses, primarily starting in October 2022.
He said that the region’s industrial activity had decreased by 30 to 40 percent, and several businesses had shut down or had suspended their single shift for the current fiscal year.
He worried that the removal of the Rs. 19.99 electricity rate and the $9 per mmBtu gas pricing would result in the closure of 50% more industries.
According to Riazuddin, since July 2022, several ministries of the Sindh government and the Sindh Bureau of Statistics (SBS) have been actively soliciting information on unemployment from various businesses. While listed companies may be submitting their employees’ statistics every month, businessmen are hesitant to offer any job loss data out of concern for harassment from these departments, he said.
He advised that until the restoration of economic operations, the different provincial government offices postpone their goals of collecting taxes and levies.
According to Faisal Moiz Khan, chairman of the North Karachi Association of Trade and Industry (NKATI), the region is home to between 5,000–6,000 small and medium-sized businesses, 60 percent of which are focused on exports and employ five to six million people.
According to him, 75 percent of industries have reduced output while about 25 percent have closed their operations, displacing more than 100,000 contractual workers.
He said, “Nearly 30 to 50 percent of Sindh’s textile industry has partially shut down, and their numbers will rise.
Due to delays in order fulfilment and shipments, the $19.3 billion export-focused business anticipates a decline in worldwide demand in the current fiscal year (FY23).
According to Moiz, the expected losses in cotton output is estimated at more than $2 billion.
In comparison to the needs of the textile industry, which consumed close to 15 million bales of cotton last year, domestic cotton production is much lower this year, he said. He noted that based on forecasted demand for the current season, the textile industry will require the import of 10 million bales.
